================================================================================
THE SELECT FAMILY
MONEY MARKET PORTFOLIO
SEMI-ANNUAL REPORT
FEBRUARY 28, 1999
================================================================================
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
SEMI-ANNUAL INVESTMENT ADVISER'S REPORT
United States government securities were a clear beneficiary of the global
financial turbulence that dominated the markets in the second half of 1998.
Propelled by a strong flight to safety, yields on short-term treasury and agency
obligations fell sharply. Three-month treasury bill yields, for example,
declined to as low as 3.65% in October, a drop of over 100 basis points in less
than six months. The reasons for such a strong rally were many. The financial
crisis that started a year ago in Asia spread to South America, Latin America
and Russia where a devaluation and default made the situation appear
particularly ominous. The rescue of a large U.S. based hedge fund in September
also weighed heavily on investor confidence. As the threat of economic recession
reaching the United States mounted, the Federal Reserve began an aggressive
campaign to add liquidity to the financial system. Between September 29 and
November 17, the Fed eased monetary policy three times, taking the federal funds
rate down to 4.75%. Encouraged by similar moves by other central banks, the
financial markets regained some measure of confidence by year-end. Treasury bill
yields rose to 4.5% and equity markets staged strong recoveries.
In addition to the strong rally in U.S. treasury obligations, the money
markets witnessed a flattening of the yield curve as sentiment shifted towards
an accommodative Fed that was willing to lower short-term interest rates to
protect U.S. economic interests. In response, the Money Market Portfolio sought
to maintain moderately extended portfolio maturities to cushion its yield
against the likelihood of still lower rates. Additionally, portfolio credit
quality was given significant emphasis as both foreign and domestic bank and
financial service companies came under intense ratings scrutiny. During the
final quarter of the year, we restricted quite a few bank and broker credits
from our list of approved securities. As of February 28, the Money Market
Portfolio had assets of $2,430,807,411.
BlackRock Institutional Management Corporation
(Please dial toll-free 800-430-9618 for questions
regarding your account or contact your broker.)
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
FEBRUARY 28, 1999
(UNAUDITED)
PAR
(000) VALUE
------- ------------
CERTIFICATES OF DEPOSIT--13.9%
DOMESTIC CERTIFICATES OF DEPOSIT--5.2%
First National Bank of Chicago
4.975% 06/07/99 ............................ $ 25,000 $ 25,001,367
4.980% 01/06/00 ............................ 50,000 49,991,778
First Tennessee Bank N.A
4.900% 04/19/99 ............................ 50,000 50,000,000
------------
124,993,145
------------
YANKEE DOLLAR CERTIFICATES OF DEPOSIT--8.7%
Canadian Imperial Bank of Commerce
5.025% 01/27/00 ............................ 30,000 29,998,684
5.120% 02/23/00 ............................ 22,300 22,289,278
Credit Communal de Belgique
5.750% 04/01/99 ............................ 30,000 29,998,777
National Westminster Bank
4.980% 01/10/00 ............................ 15,000 14,997,502
Rabobank Nederland
5.660% 07/06/99 ............................ 10,000 10,020,543
Svenska Handelsbanken Inc.
5.720% 03/31/99 ............................ 25,000 24,998,819
Toronto Dominion NY
5.000% 01/05/00 ............................ 15,000 14,998,771
5.100% 02/22/00 ............................ 20,000 19,992,439
Westpac Banking Corp.
5.730% 04/16/99 ............................ 45,000 44,998,370
------------
212,293,183
------------
TOTAL CERTIFICATES OF DEPOSIT
(Cost $337,286,328) .................... 337,286,328
------------
COMMERCIAL PAPER--58.1%
AIRCRAFT ENGINES & PARTS--4.0%
Allied Signal Inc. 4-2
4.810% 04/30/99 ............................ 48,000 47,615,200
4.830% 05/28/99 ............................ 25,000 24,704,833
4.920% 09/10/99 ............................ 25,000 24,340,583
------------
96,660,616
------------
PAR
(000) VALUE
-------- ------------
ASSET BACKED SECURITIES--17.5%
Barton Capital Corp. 4-2
4.870% 03/12/99 ............................ $ 75,211 $ 75,099,082
4.850% 04/19/99 ............................ 24,944 24,779,335
CXC Inc. 4-2
4.870% 03/16/99 ............................ 20,080 20,039,254
4.850% 04/12/99 ............................ 40,000 39,773,667
Dakota Certificates 4-2
4.880% 03/04/99 ............................ 40,000 39,983,733
4.840% 05/04/99 ............................ 50,000 49,569,778
4.830% 05/21/99 ............................ 25,000 24,728,312
Enterprise Funding Corp. 4-2
4.850% 05/25/99 ............................ 15,753 15,572,606
4.870% 05/25/99 ............................ 12,000 11,862,017
Quincy Cap Corp. 4-2
4.860% 03/12/99 ............................ 27,947 27,905,499
Triple A-1 Funding 4-2
4.860% 04/23/99 ............................ 55,291 54,895,393
Windmill Funding 4-2
4.850% 03/09/99 ............................ 40,000 39,956,889
------------
424,165,565
------------
BANKS--7.7%
AB Spin Tab Swedmortgage 3-A-3
5.170% 03/03/99 ............................ 30,000 29,991,383
5.510% 03/04/99 ............................ 25,000 24,988,521
5.060% 04/16/99 ............................ 40,000 39,741,378
4.910% 06/28/99 ............................ 50,000 49,188,486
4.840% 08/16/99 ............................ 20,000 19,548,267
Bank of America FSB 3-A-3
4.830% 07/27/99 ............................ 25,000 24,503,583
------------
187,961,618
------------
BUSINESS CREDIT INSTITUTIONS--2.1%
General Electric Capital Corp.
4.940% 03/16/99 ............................ 50,000 49,897,083
------------
COMMUNICATION EQUIPMENT NEC--1.6%
Alcatel Alsthom Inc. 3-A-3
4.900% 06/08/99 ............................ 40,000 39,461,000
------------
See Accompanying Notes to Financial Statements.
2
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
FEBRUARY 28, 1999
(UNAUDITED)
PAR
(000) VALUE
--------- ------------
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT--0.4%
General Electric Co. 3-A-3
4.820% 06/03/99 .............................. $ 9,969 $ 9,843,535
--------------
LIFE INSURANCE--1.0%
Prudential Funding Corp. 3-A-3
4.760% 07/15/99 .............................. 25,000 24,550,444
--------------
MOTOR VEHICLES & CAR BODIES--0.6%
Daimler-Benz North America 3-A-3
5.060% 04/05/99 .............................. 15,000 14,926,208
--------------
NEWSPAPER: PUBLISHING & PRINTING--5.5%
Knight-Ridder Inc.-DCP 3-A-3
5.200% 03/18/99 .............................. 30,000 29,926,333
4.780% 06/14/99 .............................. 20,000 19,721,167
5.000% 06/14/99 .............................. 15,000 14,781,250
Knight-Ridder Inc.-DCP 4-2
5.200% 03/18/99 .............................. 20,000 19,950,889
5.200% 04/14/99 .............................. 50,000 49,682,222
--------------
134,061,861
--------------
PERSONAL CREDIT INSTITUTIONS--3.1%
General Motors Acceptance Corp.
3-A-3
4.870% 03/01/99 .............................. 75,000 75,000,000
--------------
Petroleum Refining--4.8%
Koch Industries, Inc. 4-2
4.850% 03/04/99 .............................. 1,000 999,596
Repsol International 3-A-3
5.180% 03/15/99 .............................. 33,000 32,933,523
4.880% 06/07/99 .............................. 13,590 13,409,464
4.910% 06/28/99 .............................. 21,000 20,659,164
4.870% 07/15/99 .............................. 50,000 49,080,111
--------------
117,081,858
--------------
SECURITY BROKERS & DEALERS--7.1%
Goldman Sachs Group L.P.
5.230% 03/19/99 .............................. 73,000 72,809,105
Merrill Lynch & Co. Inc. 3-A-3
4.920% 03/05/99 .............................. 25,000 24,986,333
4.900% 05/24/99 .............................. 25,000 24,714,167
Morgan Stanley, Dean, Witter & Co.
4.810% 05/14/99 .............................. 50,000 49,505,639
--------------
172,015,244
--------------
PAR
(000) VALUE
-------- --------------
SHORT-TERM BUSINESS CREDIT INSTITUTIONS--2.1%
Heller Financial Inc. 3-A-3
4.940% 03/24/99 .......................... $ 50,000 $ 49,842,194
--------------
TELEPHONE COMMUNICATIONS--0.6%
BellSouth Telecommunications 3-A-3
4.780% 03/05/99 .......................... 12,568 12,561,325
GTE Funding 3-A-3
4.800% 03/26/99 .......................... 3,100 3,089,667
--------------
15,650,992
--------------
TOTAL COMMERCIAL PAPER
(Cost $1,411,118,218) ................ 1,411,118,218
--------------
MUNICIPAL BONDS--3.1%
FLORIDA--0.1%
Coral Springs,VRDN IDR (Suntrust)(DAGGER)
4.950% 03/03/99 .......................... 2,500 2,500,000
--------------
GEORGIA--0.4%
De Kalb County Development Authority
VRDN Series 1995 B (Emory
University Project)(DAGGER)
4.950% 02/28/99 .......................... 9,485 9,485,000
--------------
ILLINOIS--0.2%
Illinois Health Facilities Authority
Convertible/ VRDN Revenue Bond
(The Streeterville Corp. Project)
Series 1993-B (First National Bank
of Chicago)(DAGGER)
4.950% 03/03/99 .......................... 4,400 4,400,000
--------------
INDIANA--0.1%
Bremen, Inc. VRDN
Series 1996 B (Society National
Bank, Cleveland)(DAGGER)
5.448% 03/04/99 .......................... 2,800 2,800,000
--------------
KENTUCKY--0.2%
Boone County Taxable IDR Refunding
Bonds VRDN (Square D Company
Project) Series 1994-B
(Credit Lyonnais)(DAGGER)
4.950% 03/03/99 .......................... 4,200 4,200,000
--------------
See Accompanying Notes to Financial Statements.
3
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS
FEBRUARY 28, 1999
(UNAUDITED)
PAR
(000) VALUE
--------- ------------
MISSISSIPPI--1.1%
Hinds County, IDR Revenue Bond
VRDN Series 1992(DAGGER)
4.950% 03/03/99 .......................... $ 1,690 $ 1,690,000
Mississippi Business Finance Corp.
IDR Revenue Bond VRDN (Dana
Lighting Project) Series 1995
(Sun Bank, N.A., Orlando)(DAGGER)
4.950% 03/07/99 .......................... 5,600 5,600,000
Mississippi Business Finance Corp.
Taxable IDR Revenue Bond VRDN
(Sun Bank, N.A., Orlando)
Series 1995(DAGGER)
4.950% 03/07/99 .......................... 6,300 6,300,000
Mississippi Business Finance Corp.
Taxable IDR Revenue Bond VRDN
(Bryan Foods, Inc. Project)
Series 1994(DAGGER)
4.950% 03/03/99 .......................... 14,000 14,000,000
--------------
27,590,000
--------------
NORTH CAROLINA--0.4%
City of Asheville Tax Corp. VRDN(DAGGER)
4.950% 03/03/99 .......................... 10,800 10,800,000
--------------
TEXAS--0.6%
South Central Texas Industrial
Development Corp. Taxable IDR
Revenue Bond VRDN (Rohr
Industries Project) Series 1990
(Citibank N.A.)(DAGGER)
4.950% 03/03/99 .......................... 14,800 14,800,000
--------------
TOTAL MUNICIPAL BONDS
(Cost $76,575,000) ................... 76,575,000
--------------
VARIABLE RATE OBLIGATIONS--15.4%
BANKS--6.0%
Istituto Bancario Sao Paolo di Torino(DAGGER)
5.088% 03/08/99 .......................... 25,000 24,995,328
Nations Bank(DAGGER)
5.303% 04/02/99 .......................... 70,000 70,001,937
Royal Bank of Canada(DAGGER)
4.883% 03/14/99 .......................... 50,000 49,981,110
--------------
144,978,375
--------------
PAR
(000) VALUE
-------- --------------
FINANCE SERVICES--2.0%
General American Life(DAGGER)
5.140% 03/01/99 .......................... $ 50,000 $ 50,000,000
--------------
PERSONAL CREDIT INSTITUTIONS--6.4%
American Honda Finance Corp.(DAGGER)
5.219% 03/14/99 .......................... 40,000 40,000,000
5.200% 03/16/99 .......................... 25,000 25,000,000
4.938% 04/28/99 .......................... 35,000 35,000,000
3.085% 05/25/99 .......................... 15,000 14,997,033
General Motors Acceptance Corp.(DAGGER)
4.914% 05/26/99 .......................... 40,000 39,992,275
--------------
154,989,308
--------------
SECURITY BROKERS & DEALERS--1.0%
Bear Stearns Companies, Inc.(DAGGER)
4.905% 03/08/99 .......................... 25,000 25,000,218
--------------
TOTAL VARIABLE RATE OBLIGATIONS
(Cost $374,967,901) .................. 374,967,901
--------------
MEDIUM TERM NOTES--0.3%
SECURITY BROKERS & DEALERS--0.3%
Goldman Sachs Group LP
5.280% 02/24/00 .......................... 7,500 7,499,852
--------------
TOTAL MEDIUM TERM NOTES
(Cost $7,499,852) .................... 7,499,852
--------------
TIME DEPOSITS--3.1%
Bank of Montreal
4.875% 03/01/99 .......................... 75,000 75,000,000
--------------
TOTAL TIME DEPOSITS
(Cost $75,000,000) ................... 75,000,000
--------------
See Accompanying Notes to Financial Statements.
4
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF NET ASSETS (CONCLUDED)
FEBRUARY 28, 1999
(UNAUDITED)
PAR
(000) VALUE
--------- --------------
REPURCHASE AGREEMENTS--5.8
Lehman Brothers
(Agreement dated 02/26/99 to be
repurchased at $141,356,520,
collateralized by $91,564,115
Federal Home Loan Mortgage
Corporation Collateralized Mortgage
Obligation at rates of 6.23% to
6.849% due 04/15/28 to 09/15/28,
$21,738,647 Federal National
Mortgage Association Collateralized
Mortgage Obligation at a rate of
6.50% due 09/25/28, $10,337,915
Federal Home Loan Mortgage
Corporation Collateralized Mortgage
Obligation at a rate of 5.44% due
02/15/28, $21,905,196 Federal
National Mortgage Association
Collateralized Mortgage Obligation
at rates of 6.50% to 7.00% due
09/25/28 to 11/15/28. Market Value
of Collateral is $145,545,873.)
4.800% 03/01/99 ....................... $141,300 $ 141,300,000
--------------
TOTAL REPURCHASE AGREEMENTS
(Cost $141,300,000) ................. 141,300,000
--------------
TOTAL INVESTMENTS AT VALUE--99.7%
(Cost $2,423,747,299*) .................. 2,423,747,299
--------------
VALUE
--------------
OTHER ASSETS IN EXCESS
OF LIABILITIES--0.3% .................... $ 7,060,112
--------------
NET ASSETS (Applicable to 589,664,368
Bedford shares, 158,401 Cash
Preservation shares, 1,034,494,733
Janney Montgomery Scott shares,
776,662,225 Sansom Street shares,
29,824,176 Select shares, and 800
other shares)--100.0% ................... $2,430,807,411
==============
NET ASSET VALUE, Offering and
Redemption Price Per Share
($2,430,807,411 (DIVIDE) 2,430,804,703 .. $1.00
=====
* Also cost for Federal income tax purposes.
(DAGGER) Variable Rate Obligations -- The rate shown is the rate as of February
28, 1999 and the maturity date shown is the longer of the next interest
rate readjustment date or the date the principal amount shown can be
recovered through demand.
INVESTMENT ABBREVIATIONS
VRDN ..................................................Variable Rate Demand Note
LOC ............................................................Letter of Credit
IDR ..............................................Industrial Development Revenue
See Accompanying Notes to Financial Statements.
5
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIO
STATEMENT OF OPERATIONS
FOR THE PERIOD ENDED FEBRUARY 28, 1999 (UNAUDITED)(a)
Investment Income
Interest ............................................ $67,932,605
-----------
Expenses
Investment advisory fees ............................ 4,607,483
Administration fees ................................. --
Distribution fees ................................... 5,473,879
Service organization fees ........................... 271,242
Directors' fees ..................................... 32,956
Custodian fees ...................................... 201,254
Transfer agent fees ................................. 1,505,760
Legal fees .......................................... 56,943
Audit fees .......................................... 66,476
Registration fees ................................... 150,000
Insurance expense ................................... 21,022
Printing fees ....................................... 266,257
SEC fees ............................................ 2,611
Miscellaneous ....................................... 326
-----------
12,656,209
Less fees waived and reimbursements ................. (2,014,787)
-----------
Total expenses ................................. 10,641,422
-----------
Net investment income .................................. 57,291,183
-----------
Net realized gain/(loss) on investments ................ 131,056
-----------
Net increase in net assets resulting from operations ... $57,422,239
===========
(a) On December 15, 1998, the Select Class of shares of the RBB Money Market
Fund began operations.
See Accompanying Notes to Financial Statements.
6
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
MONEY MARKET PORTFOLIOS
STATEMENT OF CHANGES IN NET ASSETS(a)
FOR THE PERIOD
DECEMBER 15, 1998
TO
FEBRUARY 28, 1999
-----------------
(UNAUDITED)
Increase (decrease) in net assets:
Operations:
Net investment income ....................................... $ 57,291,183
Net realized gain (loss) on investments ..................... 131,056
--------------
Net increase in net assets resulting from operations ........ 57,422,239
--------------
Distributions to shareholders:
Dividends to shareholders from net investment income:
Bedford shares ............................................ (18,350,903)
Bradford shares ........................................... --
Cash Preservation shares .................................. (4,108)
Janney Montgomery Scott shares ............................ (21,174,670)
Select shares ............................................. (352,247)
Sansom Street shares ...................................... (17,409,255)
Dividends to shareholders from net realized short-term gains:
Bedford shares ............................................ (2,671)
Bradford shares ........................................... --
Cash Preservation shares .................................. (1)
Janney Montgomery Scott shares ............................ (2,921)
Select shares ............................................. (102)
Sansom Street shares ...................................... (2,010)
Total dividends to shareholders ......................... (57,298,888)
--------------
Net capital share transactions ................................ 115,125,760
--------------
Total increase in net assets .................................. 115,249,111
Net Assets:
Beginning of period ......................................... 2,315,558,300
--------------
End of period ............................................... $2,430,807,411
==============
(a) On December 15, 1998, the Select Class of shares of the RBB Money Market
Fund began operations.
See Accompanying Notes to Financial Statements.
7
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
FINANCIAL HIGHLIGHTS (b)
(FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD)
MONEY MARKET PORTFOLIO
----------------------
FOR THE PERIOD
DECEMBER 15, 1998(c)
TO
FEBRUARY 28, 1999
----------------------
(UNAUDITED)
Net asset value, beginning of period ......................... $ 1.00
--------
Income from investment operations:
Net investment income ..................................... 0.0103
--------
Total from investment operations ........................ 0.0103
--------
Less distributions
Dividends (from net investment income) .................... (0.0103)
--------
Total distributions ..................................... (0.0103)
--------
Net asset value, end of period ............................... $ 1.00
========
Total Return ................................................. 5.06%(d)
Ratios /Supplemental Data
Net assets, end of period ................................. $ 29,824
Ratios of expenses to average net assets .................. .27%(a)(d)
Ratios of net investment income to
average net assets ...................................... 4.95%(d)
(a) Without the waiver of advisory and transfer agent fees and without the
reimbursement of certain operating expenses, the ratios of expenses to
average net assets for the Money Market Portfolio would have been .46% for
the six months ended February 28, 1999.
(b) Financial highlights relate soley to the Select Class of shares within the
portflio.
(c) On December 15, 1998 the Money Market Portfolio's Select Class began
operations.
(d) Annualized.
8
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 28, 1999
(UNAUDITED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The RBB Fund, Inc. (the "Fund") is registered under the Investment Company
Act of 1940, as amended, as an open-end management investment company. The Fund
was incorporated in Maryland on February 29, 1988.
The Fund has authorized capital of thirty billion shares of common stock of
which 19.83 billion shares are currently classified into ninety-seven classes.
Each class represents an interest in one of sixteen investment portfolios of the
Fund. The classes have been grouped into fifteen separate "families", nine of
which have begun investment operations: the RBB Family, the Select Family, the
Sansom Street Family, the Bedford Family, the Cash Preservation Family, the
Janney Montgomery Money Family, the n\i numeric investors Family, the Boston
Partners Family and the Schneider Family. The Select Family represents interests
in the Money Market Portfolio, which is covered in this report.
A) SECURITY VALUATION -- Portfolio securities are valued under the
amortized cost method, which approximates current market value. Under this
method, securities are valued at cost when purchased and thereafter a
constant proportionate amortization of any discount or premium is recorded
until maturity of the security. Regular review and monitoring of the
valuation is performed in an attempt to avoid dilution or other unfair
results to shareholders. The Portfolio seeks to maintain net asset value
per share at $1.00.
B) SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security
transactions are accounted for on the trade date. The cost of investments
sold is determined by use of the specific identification method for both
financial reporting and income tax purposes. Interest income is recorded on
the accrual basis. Certain expenses, principally distribution, transfer
agency and printing, are class specific expenses and vary by class.
Expenses not directly attributable to a specific portfolio or class are
allocated among all of the portfolios or classes of the Fund based on
relative net assets of each portfolio.
C) DISTRIBUTIONS TO SHAREHOLDERS -- Dividends from net investment
income are declared daily and paid monthly. Any net realized capital gains
are distributed at least annually. Income distributions and capital gain
distributions are determined in accordance with income tax regulations
which may differ from generally accepted accounting principals.
D) FEDERAL INCOME TAXES -- No provision is made for Federal taxes
as it is the Fund's intention to have each portfolio to continue to qualify
for and elect the tax treatment applicable to regulated investment
companies under the Internal Revenue Code and make the requisite
distributions to its shareholders which will be sufficient to relieve it
from Federal income and excise taxes.
E) REPURCHASE AGREEMENTS -- Money market instruments may be
purchased subject to the seller's agreement to repurchase them at an agreed
upon date and price. The seller will be required on a daily basis to
maintain the value of the securities subject to the agreement at not less
than there repurchase price plus accrued interest. If the value of the
underlying securities falls below 102% of the value of the purchase price
plus accrued interest, the Fund will require the seller to deposit
additional collateral by the next Fund business day. In the event that the
seller under the agreement defaults on its repurchase obligation or fails
to deposit sufficient collateral, the Fund has the contractual right,
subject to the requirements of applicable bankruptcy and insolvency laws,
to sell the underlying securities and may claim any resulting loss from the
seller. The agreements are conditioned upon the collateral being deposited
under the Federal Reserve book-entry system or with the Fund's custodian or
a third party sub-custodian.
F) USE OF ESTIMATES -- The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumption that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
9
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 1999
(UNAUDITED)
NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
Pursuant to Investment Advisory Agreements, BlackRock Institutional
Management Corporation ("BIMC"), an indirectly majority-owned subsidiary of PNC
Bank, serves as investment advisor for the portfolio described herein.
For its advisory services, BIMC is entitled to receive the following fees,
computed daily and payable monthly based on the portfolio's average daily net
assets:
.45% of first $250 million of net assets;
.40% of next $250 million of net assets;
.35% of net assets in excess of $500 million.
BIMC may, at its discretion, voluntarily waive all or any portion of its
advisory fee for this portfolio. For each class of shares within a respective
portfolio, the net advisory fee charged to each class is the same on a relative
basis. For the six months ended February 28, 1999, advisory fees and waivers for
the investment portfolio were as follows:
GROSS NET
ADVISORY ADVISORY
FEE WAIVER FEE
-------------- -------------- --------------
$4,607,483 $(1,724,370) $2,883,113
The investment advisor has agreed to reimburse each portfolio for the
amount, if any, by which the total operating and management expenses exceed the
expense cap. For the six months ended February 28, 1999 the reimbursed expenses
were $286,257 for the Money Market Portfolio.
PFPC Trust Company serves as custodian for the Fund's portfolios. PFPC Inc.
("PFPC") serves as each class's transfer and dividend disbursing agent. Both
PFPC Trust Company and PFPC are wholly-owned subsidiaries of PFPC Worldwide
Inc., an indirect majority-owned subsidiary of PNC Bank Corp.
PFPC may, at its discretion, voluntarily waive all or any portion of its
transfer agency fee for any class of shares. For the six months ended February
28, 1999, transfer agency fees and waivers for each class of shares within the
investment portfolio were as follows:
GROSS NET
TRANSFER AGENCY TRANSFER AGENCY
FEE WAIVER FEE
--------------- ---------- ---------------
Bedford Class $ 366,050 $ -- $ 366,050
Cash Preservation Class 4,419 (4,161) 258
Janney Montgomery Scott Class 840,000 -- 840,000
Sansom Street Class 295,291 -- 295,291
--------- ------- ---------
Total $1,505,760 $(4,161) $1,501,599
========== ======= ==========
The Fund, on behalf of each class of shares within this investment
portfolio, has adopted Distribution Plans pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended, and has entered into Distribution
Contracts with Provident Distributors Inc. ("PDI"), which provide for each class
to make monthly payments, based on average net assets, to PDI of up to .65% on
an annualized basis for the Bedford, Cash Preservation and Janney Montgomery
Scott Classes and up to .20% on an annualized basis for the Sansom Street Class.
10
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 1999
(UNAUDITED)
NOTE 2. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES (CONTINUED)
For the six months ended February 28, 1999, distribution fees for each
class were as follows:
DISTRIBUTION
FEE
------------
Bedford Class $2,384,887
Cash Preservation Class 368
Janney Montgomery Scott Class 2,906,358
Sansom Street Class 182,266
----------
Total $5,473,879
==========
The Fund has entered into service agreements with banks affiliated with PNC
Bank who render support services to customers who are the beneficial owners of
the Sansom Street Class in consideration of the payment of .10% of the daily net
asset value of such shares. For the six months ended February 28, 1999 service
organization fees were $271,242 for the Money Market Portfolio.
NOTE 3. CAPITAL SHARES
Transactions in capital shares (at $1.00 per capital share) for each year
were as follows:
MONEY MARKET PORTFOLIO
---------------------------------------
FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED
FEBRUARY 28, 1999 AUGUST 31, 1998
----------------- ---------------
(UNAUDITED)
VALUE VALUE
----------------- ---------------
Shares sold:
Bedford Class ........................$ 1,267,431,197 $ 4,081,920,081
Cash Preservation Class .............. 61,164 113,319
Janney Montgomery Scott Class ........ 2,305,678,119 3,910,533,620
Sansom Street Class .................. 1,317,481,175 2,296,071,622
Select Class ......................... 90,525,850 --
Shares issued in reinvestment
of dividends:
Bedford Class ........................ 18,390,680 56,201,453
Cash Preservation Class .............. 4,289 10,291
Janney Montgomery Scott Class ........ 21,655,093 37,882,680
Sansom Street Class .................. 13,647,696 24,189,907
Select Class ......................... 347,981 --
Shares repurchased:
Bedford Class ........................ (1,458,952,186) (4,768,237,064)
Cash Preservation Class .............. (133,353) (139,525)
Janney Montgomery Scott Class ........ (2,197,396,680) (3,780,710,398)
Sansom Street Class .................. (1,202,565,612) (2,242,193,855)
Select Class ......................... (61,049,653) --
-------------- --------------
Net increase (decrease) ................. $ 115,125,760 $ (384,357,869)
-------------- --------------
Select Shares authorized ................ 700,000,000 700,000,000
============== ==============
11
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 1999
(UNAUDITED)
NOTE 4. NET ASSETS
At February 28, 1999, net assets consisted of the following:
Capital paid-in
Bedford Class $ 589,664,368
Cash Preservation Class 158,401
Janney Montgomery Scott Class 1,034,494,733
Sansom Street Class 776,662,225
Select Class 29,824,176
Other Classes 800
Accumulated net realized gain (loss) on investments
Bedford Class (12,013)
Cash Preservation Class (5)
Janney Montgomery Scott Class 8,010
Sansom Street Class 5,203
Select Class 1,513
---------------
$ 2,430,807,411
===============
12
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 1999
(UNAUDITED)
NOTE 5. OTHER FINANCIAL HIGHLIGHTS
The Fund currently offers four other classes of shares representing
interest in the Money Market Portfolio: Bedford, Cash Preservation, Sansom, and
Janney Montgomery Scott. Each class is marketed to different types of investors.
Financial Highlights of the Cash Preservation class is not presented in this
report due to its immateriality. Such information is available in the annual
report of its respective family. The financial highlights of certain of the
other classes are as follows:
THE BEDFORD FAMILY (b)
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
----------------------------------------------------------------------------------------
FOR THE FOR THE FOR THE FOR THE FOR THE
SIX MONTHS YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED
FEBRUARY 28, 1999 AUGUST 31, 1998 AUGUST 31, 1997 AUGUST 31, 1996 AUGUST 31, 1995
----------------- --------------- --------------- --------------- ---------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- ---------- ---------- --------
Income from investment operations:
Net investment income .............. 0.0219 0.0473 0.0462 0.0469 0.0486
-------- -------- ---------- ---------- --------
Total from investment operations . 0.0219 0.0473 0.0462 0.0469 0.0486
-------- -------- ---------- ---------- --------
Less distributions
Dividends (from net investment income) (0.0219) (0.0473) (0.0462) (0.0469) (0.0486)
-------- -------- ---------- ---------- --------
Total distributions .............. (0.0219) (0.0473) (0.0462) (0.0469) (0.0486)
-------- -------- ---------- ---------- --------
Net asset value, end of period ....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ========== ========== ========
Total Return ......................... 4.50%(c) 4.84% 4.72% 4.79% 4.97%
Ratios/Supplemental Data
Net assets, end of period (000) .... $589,649 $762,739 $1,392,911 $1,109,334 $935,821
Ratios of expenses to
average net assets ............... .97%(a)(c) .97%(a) .97%(a) .97%(a) .96%(a)
Ratios of net investment income
to average net assets ............ 4.41%(c) 4.73% 4.62% 4.69% 4.86%
<FN>
(a) Without the waiver of advisory and administration fees and without the
reimbursement of certain operating expenses, the ratios of expenses to
average net assets for the Money Market Portfolio would have been 1.11% for
the six months ended February 28, 1999, 1.10%, 1.12%, 1.14% and 1.17% for
the years ended August 31, 1998, 1997, 1996 and 1995, respectively.
(b) Financial Highlights relate solely to the Bedford Class of shares within
each portfolio.
(c) Annualized.
</FN>
</TABLE>
13
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 1999
(UNAUDITED)
NOTE 5. OTHER FINANCIAL HIGHLIGHTS (CONTINUED)
THE JANNEY MONTGOMERY SCOTT MONEY FUNDS (c)
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
----------------------------------------------------------------------------------------
FOR THE PERIOD
FOR THE FOR THE FOR THE FOR THE JUNE 12, 1995
SIX MONTHS YEAR YEAR YEAR (COMMENCEMENT OF
ENDED ENDED ENDED ENDED OPERATIONS) TO
FEBRUARY 28, 1999 AUGUST 31, 1998 AUGUST 31, 1997 AUGUST 31, 1996 AUGUST 31, 1995
----------------- --------------- --------------- --------------- ----------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net asset value, beginning
of period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- -------- -------- -------- ---------
Income from investment operations:
Net investment income .......... 0.0217 0.0469 0.0459 0.0465 0.0112
---------- -------- -------- -------- ---------
Total from investment operations 0.0217 0.0469 0.0459 0.0465 0.0112
---------- -------- -------- -------- ---------
Less distributions
Dividends (from net
investment income) ............. (0.0217) (0.0469) (0.0459) (0.0465) (0.0112)
---------- -------- -------- -------- --------
Total distributions .......... (0.0217) (0.0469) (0.0459) (0.0465) (0.0112)
---------- -------- -------- -------- --------
Net asset value, end of period ... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ======== ======== ======== ========
Total Return ..................... 4.47%(b) 4.81% 4.69% 4.76% 5.30%(b)
Ratios/Supplemental Data
Net assets, end of period (000) $1,034,508 $904,526 $736,855 $561,865 $443,645
Ratios of expenses to average
net assets ................... 1.00%(a)(b) 1.00%(a) 1.00%(a) 1.00%(a) 1.00%(a)(b)
Ratios of net investment income
to average net assets ........ 4.37%(b) 4.69% 4.59% 4.65% 5.04%(b)
<FN>
(a) Without the waiver of advisory, administration and transfer agent fees and
without the reimbursement of certain operating expenses, the ratios of
expenses to average net assets for the Money Market Portfolio would have
been 1.20% for the six months ended February 28, 1999, 1.21%, 1.22%, 1.23%
and 1.23% for the years ended August 31, 1998, 1997, 1996 and 1995,
respectively.
(b) Annualized.
(c) Financial Highlights relate solely to the Janney Montgomery Scott Class of
shares within each portfolio.
</FN>
</TABLE>
14
<PAGE>
THE SELECT FAMILY
THE RBB FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
FEBRUARY 28, 1999
(UNAUDITED)
NOTE 5. OTHER FINANCIAL HIGHLIGHTS (CONTINUED)
THE SANSOM STREET FAMILY (b)
<TABLE>
<CAPTION>
MONEY MARKET PORTFOLIO
--------------------------------------------------------------------------------------
FOR THE FOR THE FOR THE FOR THE FOR THE
SIX MONTHS YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED
FEBRUARY 28, 1999 AUGUST 31, 1998 AUGUST 31, 1997 AUGUST 31, 1996 AUGUST 31, 1995
----------------- --------------- --------------- --------------- ---------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Income from investment operations:
Net investment income ............... 0.0242 0.0520 0.0510 0.0518 0.0543
-------- -------- -------- -------- --------
Total from investment operations .. 0.0242 0.0520 0.0510 0.0518 0.0543
-------- -------- -------- -------- --------
Less distributions
Dividends (from net investment income) (0.0242) (0.0520) (0.0510) (0.0518) (0.0543)
-------- -------- -------- -------- --------
Total distributions ............... (0.0242) (0.0520) (0.0510) (0.0518) (0.0543)
-------- -------- -------- -------- --------
Net asset value, end of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
Total Return .......................... 5.00%(c) 5.34% 5.22% 5.30% 5.57%
Ratios /Supplemental Data
Net assets, end of period ........... $776,676 $684,066 $570,018 $524,359 $441,614
Ratios of expenses to
average net assets ................ .49%(a)(c) .49%(a) .49%(a) .48%(a) .39%(a)
Ratios of net investment income
to average net assets ............. 4.89%(c) 5.20% 5.10% 5.18% 5.43%
<FN>
(a) Without the waiver of advisory and transfer agent fees and without the
reimbursement of certain operating expenses, the ratios of expenses to
average net assets for the Money Market Portfolio would have been .63% for
the six months ended February 28, 1999, .62%, .64%, .65% and .59% for the
years ended August 31, 1998, 1997, 1996 and 1995 respectively.
(b) Financial highlights relate soley to the Sansom Street Class of shares
within the portfolio.
(c) Annualized.
</FN>
</TABLE>
15
